International Minerals & Chemical Corp. v. Avon Products, Inc.

817 S.W.2d 903, 1991 WL 208796
CourtSupreme Court of Missouri
DecidedNovember 19, 1991
Docket73734
StatusPublished
Cited by25 cases

This text of 817 S.W.2d 903 (International Minerals & Chemical Corp. v. Avon Products, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
International Minerals & Chemical Corp. v. Avon Products, Inc., 817 S.W.2d 903, 1991 WL 208796 (Mo. 1991).

Opinions

[904]*904BLACKMAR, Judge.

On February 28, 1986, Avon Products, Inc. sold all of the stock of a wholly-owned subsidiary, Mallinckrodt, Inc., to International Minerals and Chemical Corporation for a price of $675,000,000 cash. Avon undertook to indemnify International against contingent liabilities of Mallinckrodt. A pending patent suit by E.I. DuPont de Nemours & Company was specifically listed in a schedule of such liabilities known to Avon at the time of closing. The trial court’s decree, entered in January of 1987, was not substantially unfavorable, but the judgment on appeal was disastrous to Mallinckrodt, producing a situation in which one of its most profitable products could be marketed only if it paid DuPont substantial damages and a large continuing royalty. Mallinckrodt settled the suit with the consent of Avon, with Avon seeking to preserve certain rights in its letter of consent.

Mallinckrodt filed suit seeking indemnity for the DuPont settlement and other liabilities not here material. The trial court, after a series of procedural skirmishes, entered a partial summary judgment finding that Avon was liable under the indemnity clause but leaving damages for later determination. The court on its own initiative found, pursuant to Rule 74.01(b), that there was no just reason for delay in entering judgment on this claim, and Avon appealed. The Court of Appeals, Eastern District, dismissed the appeal, finding that the trial court lacked the authority to enter an appealable judgment. We granted transfer to consider the scope of Rule 74--01(b), and now assume jurisdiction of the entire appeal. We determine that appellate jurisdiction is present, affirm the partial judgment of the trial court, and remand for further proceedings.

1. Appealability

Both parties disagree with the jurisdictional ruling of the court of appeals and urge us to consider the merits of the appeal. Their consent is not enough. We must determine for ourselves whether appellate jurisdiction is present. Once we make this essential finding, however, the parties’ consent or acquiescence may operate to eliminate or to waive procedural problems which fall short of being jurisdictional.

The plaintiffs initially filed a petition for declaratory judgment of liability for indemnity. This petition was dismissed by Circuit Judge Robert G. Dowd, Jr., with leave to amend, on the basis that there was an adequate remedy at law rendering declaratory relief unnecessary. The plaintiffs then filed an amended petition in five counts. Count I sought a declaratory judgment of liability. Counts II, III and IV sought declaratory relief involving other unrelated claims for indemnification. Count V was an action for damages for breach of the indemnity contract. In the musical chair operation of the 22nd Judicial Circuit the case passed to Judge Ryan, who dismissed the portions of the prayers seeking declaratory relief. The case was then assigned to Judge McBride.

The plaintiffs filed a motion for summary judgment as to liability. The parties adduced voluminous depositions, affidavits and exhibits. The trial court sustained this motion, by an order specifying as follows:

The Court enters its order and judgment herein granting plaintiffs’ motion for partial summary judgment on liability with respect to Count I only, and sua sponte, pursuant to Supreme Court Rule 74.01(b) and Hampton Foods, Inc. v. Wetterau Finance, 780 S.W.2d 79 (Mo. App.1989), designates its order and judgment final for purposes of appeal, and expressly determines that there is no just reason for delay in the appeal of its order and judgment.

The court of appeals, in a thorough and scholarly opinion, concluded that a judgment of this kind, adjudging liability only and not ruling the issue of damages, could not constitute a final and appealable judgment because, by leaving damages for future determination, it did not finally determine any discrete segment of the case. The opinion cited numerous federal authorities construing Rule 54(b), FRCP. The tenor of these holdings is that a trial judge [905]*905cannot enter an appealable judgment which determines only the issue of liability, leaving the question of damages for future determination. There are indications that the federal cases are not unvarying in this holding, but we need not pursue the point. Federal authorities are of interest but not controlling. In contrast to some of our other procedural rules, Rule 74.01(b) does not borrow substantially from the federal model. It reads as follows:

When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may enter a judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay. In the absence of such determination, any order or other form of decision, however designated, that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.

We believe that our rule allows the trial court more discretion than would apparently be permitted under some of the federal authorities cited. In Speck v. Union Electric Co., 731 S.W.2d 16 (Mo. banc 1987), the trial court designated its judgment dismissing the case against one of several defendants as final for purposes of appeal, under our prior Rule 81.0611 We sustained appellate jurisdiction even though the court of appeals had found that a judgment terminating the case as to one party only could not be appealable. The convenience of permitting an immediate appeal was apparent because, in the context of Missouri Pacific Railway Co. v. Whitehead & Kales, 566 S.W.2d 466 (Mo. banc 1978), it is important to know which defendants will remain in the case. We upheld the discretion of the trial court in its designation of finality under the rule then in force.

To the same effect is Spires v. Edgar, 513 S.W.2d 372 (Mo. banc 1974), in which the trial court dismissed a petition as to one of three defendants, and the plaintiff appealed. The trial court designated the dismissal order as final under then Rule 81.06. The Court found appealability, rejecting a much narrower construction of Rule 81.06 advocated in a dissenting opinion.2

In Dotson v. E. W. Bacharach, Inc., 325 S.W.2d 737 (Mo.1959), the Court dismissed an appeal from a judgment dismissing a counterclaim, solely because the judgment did not include the required language of finality prescribed by Rule 81.06. The Court reviewed the history of Rule 81.06,

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Bluebook (online)
817 S.W.2d 903, 1991 WL 208796, Counsel Stack Legal Research, https://law.counselstack.com/opinion/international-minerals-chemical-corp-v-avon-products-inc-mo-1991.